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Ares Management (ARES)

Ares Management Corporation is a leading global alternative investment manager operating three integrated businesses across Credit, Private Equity and Real Estate. Ares Management's investment groups collaborate to deliver innovative investment solutions and consistent and attractive investment returns for fund investors throughout market cycles. Ares Management's global platform had $149 billion of assets under management as of March 31, 2020 with more than 1,200 employees in over 20 offices in more than 10 countries.

Company profile

Ticker
ARES
Exchange
CEO
Michael Arougheti
Employees
Incorporated
Location
Fiscal year end
Industry (SIC)
Former names
ARES MANAGEMENT LP
SEC CIK
Subsidiaries
Ares ECSF II GP LLC • Ares ECSF II (B) GP, L.P. • Ares Centre Street GP, Inc. • Ares Commercial Finance GP LP • ACF GP LLC • ACF Management Investment, LLC • Ares CCF GP, L.P. • Ares CCF GP Limited • Ares CCF GP LLC • Ares Jasper GP, L.P. ...
SEC advisor number
801-63800
FINRA CRD number
130074
AUM ?
$203.42B (as of 23 Aug 22)
Accounts
341 (as of 23 Aug 22)
Employees
1,769 (721 investment advisory or research)
Address
Ares Management
2000 AVE OF THE STARS
12TH FLOOR
LOS ANGELES
CA 90067
Phone
3102014100

ARES stock data

Calendar

4 Aug 22
1 Oct 22
31 Dec 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 252.87M 252.87M 252.87M 252.87M 252.87M 252.87M
Cash burn (monthly) 31.06M 27.5M (no burn) (no burn) 264.12M 174.6M
Cash used (since last report) 94.98M 84.11M n/a n/a 807.7M 533.95M
Cash remaining 157.89M 168.76M n/a n/a -554.84M -281.08M
Runway (months of cash) 5.1 6.1 n/a n/a -2.1 -1.6

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
29 Sep 22 Ares Management Common Stock, par value $0.01 Buy Acquire P Yes No 1.375 200,000 275K 48,471,580
28 Sep 22 Ares Management Common Stock, par value $0.01 Buy Acquire P Yes No 1.3971 200,000 279.42K 48,271,580
27 Sep 22 Ares Management Common Stock, par value $0.01 Buy Acquire P Yes No 1.3951 200,000 279.02K 48,071,580
26 Sep 22 Ares Management Common Stock, par value $0.01 Buy Acquire P Yes No 1.3521 200,000 270.42K 47,871,580
3 Aug 22 Aghili Naseem Sagati Class A Common Stock Sell Dispose S No No 73.18 7,446 544.9K 218,082
2 Aug 22 Aghili Naseem Sagati Class A Common Stock Payment of exercise Dispose F No No 72.64 12,554 911.92K 225,528
2 Aug 22 Aghili Naseem Sagati Class A Common Stock Option exercise Acquire M No No 19 20,000 380K 238,082
2 Aug 22 Aghili Naseem Sagati Options Class A Common Stock Option exercise Dispose M No No 19 20,000 380K 59,262
28 Jul 22 Olian Judy D. Class A Common Stock Grant Acquire A No No 0 2,787 0 30,197
13F holders Current Prev Q Change
Total holders 345 355 -2.8%
Opened positions 52 48 +8.3%
Closed positions 62 51 +21.6%
Increased positions 117 132 -11.4%
Reduced positions 127 110 +15.5%
13F shares Current Prev Q Change
Total value 13.92B 22.06B -36.9%
Total shares 272.32M 269.93M +0.9%
Total puts 55.9K 75.6K -26.1%
Total calls 188.5K 130.7K +44.2%
Total put/call ratio 0.3 0.6 -48.7%
Largest owners Shares Value Change
Ares Partners Holdco 134.57M $0 0.0%
Wellington Management 19.39M $1.1B +22.7%
Vanguard 14.56M $828.1M +3.7%
SMFG Sumitomo Mitsui Financial 13.36M $759.92M 0.0%
Capital World Investors 10.06M $572.06M -0.0%
Capital International Investors 6.59M $374.43M 0.0%
BLK Blackrock 6.13M $348.59M -1.0%
FMR 4.05M $230.24M -11.6%
HMI Capital 3.8M $216.01M +6.8%
William Blair Investment Management 2.93M $166.88M -13.8%
Largest transactions Shares Bought/sold Change
Wellington Management 19.39M +3.58M +22.7%
Millennium Management 1.1M +1.06M +2387.7%
Meag Munich Ergo Kapitalanlagegesellschaft MBH 611.12K +611.12K NEW
AMP Ameriprise Financial 1.3M -558.06K -30.0%
FMR 4.05M -530.89K -11.6%
Junto Capital Management 718.49K -528.84K -42.4%
Vanguard 14.56M +525.58K +3.7%
TROW T. Rowe Price 544.16K +484.28K +808.6%
William Blair Investment Management 2.93M -470.76K -13.8%
Jennison Associates 23.87K -459.17K -95.1%

Financial report summary

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Risks
  • Difficult market and political conditions may adversely affect our businesses in many ways, including by reducing the value or hampering the performance of the investments made by our funds or reducing the ability of our funds to raise or deploy capital, each of which could materially reduce our revenue, earnings and cash flow and adversely affect our financial prospects and condition.
  • The COVID-19 pandemic has caused severe disruptions in the U.S. and global economy, has disrupted, and may continue to disrupt, industries in which we, our funds and our funds’ portfolio companies operate and could potentially negatively impact us, our funds or our funds’ portfolio companies.
  • Political and regulatory conditions, including the effects of negative publicity surrounding the financial industry in general and proposed legislation, could adversely affect our businesses.
  • Changes in relevant tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities may adversely affect our effective tax rate, tax liability and financial condition and results.
  • Our business depends in large part on our ability to raise capital from investors. If we were unable to raise such capital, we would be unable to collect management fees or deploy such capital into investments, which would materially reduce our revenues and cash flow and adversely affect our financial condition.
  • We depend on the members of the Executive Management Committee, senior professionals and other key personnel, and our ability to retain them and attract additional qualified personnel is critical to our success and our growth prospects.
  • Our failure to appropriately address conflicts of interest could damage our reputation and adversely affect our businesses.
  • Conflicts of interest may arise in our allocation of co-investment opportunities.
  • The investment management business is intensely competitive.
  • ARCC’s management fee comprises a significant portion of our management fees and a reduction in fees from ARCC could have an adverse effect on our revenues and results of operations.
  • We may not be able to maintain our current fee structure as a result of industry pressure from fund investors to reduce fees, which could have an adverse effect on our profit margins and results of operations.
  • Rapid growth of our businesses, particularly outside the United States, may be difficult to sustain and may place significant demands on our administrative, operational and financial resources.
  • We may enter into new lines of business and expand into new investment strategies, geographic markets, strategic partnerships and businesses, each of which may result in additional risks, expenses and uncertainties in our businesses.
  • If we are unable to consummate or successfully integrate development opportunities, acquisitions or joint ventures, we may not be able to implement our growth strategy successfully.
  • Extensive regulation affects our activities, increases the cost of doing business and creates the potential for significant liabilities and penalties that could adversely affect our businesses and results of operations.
  • Regulations impacting the insurance industry could adversely affect our business and our operations, and our provision of products and services to insurance companies, including through Aspida, subjects us to a variety of risks and uncertainties.
  • Employee misconduct could harm us by impairing our ability to attract and retain investors and subjecting us to significant legal liability, regulatory scrutiny and reputational harm.
  • The publicly-traded investment vehicles that we manage are subject to regulatory complexities that limit the way in which they do business and may subject them to a higher level of regulatory scrutiny.
  • The U.K.’s exit from the EU (“Brexit”) could adversely affect our business and our operations.
  • We are subject to risks in using prime brokers, custodians, counterparties, administrators and other agents.
  • A portion of our revenue, earnings and cash flow is variable, which may make it difficult for us to achieve steady earnings growth on a quarterly basis and may cause the price of shares of our Class A common stock to decline.
  • Fraud and other deceptive practices or other misconduct at our portfolio companies, properties or projects could similarly subject us to liability and reputational damage and also harm our businesses.
  • Our use of leverage to finance our businesses exposes us to substantial risks.
  • Operational risks may disrupt our businesses, result in losses or limit our growth.
  • We have made a significant investment in a subsidiary that is the sponsor of a SPAC, and will suffer the loss of all of our investment if the SPAC does not complete an acquisition within two years.
  • The historical returns attributable to our funds should not be considered as indicative of the future results of our funds or of our future results or of any returns expected on an investment in shares of our Class A common stock.
  • Valuation methodologies for certain assets can be subject to significant subjectivity, and the values of assets may never be realized.
  • Market values of debt instruments and publicly-traded securities that our funds hold as investments may be volatile.
  • Our funds may be unable to deploy capital at a steady and consistent pace, which could have an adverse effect on our results of operations and future fundraising.
  • Our funds depend on investment cycles, and any change in such cycles could have an adverse effect on our investment prospects.
  • Dependence on significant leverage by our funds subjects us to volatility and contractions in the debt financing markets could adversely affect our ability to achieve attractive rates of return on those investments.
  • Some of our funds may invest in companies that are highly leveraged, which may increase the risk of loss associated with those investments.
  • Many of our funds invest in assets that are high risk, illiquid or subject to restrictions on transfer and we may fail to realize any profits from these activities ever or for a considerable period of time.
  • Certain of our funds utilize special situation and distressed debt investment strategies that involve significant risks.
  • Certain of the funds or accounts we advise or manage are subject to the fiduciary responsibility and prohibited transaction provisions of ERISA and Section 4975 of the Code, and our businesses could be adversely affected if certain of our other funds or accounts fail to satisfy an exception under the “plan assets” regulation under ERISA.
  • Our funds may be held liable for the underfunded pension liabilities of their portfolio companies.
  • Our funds’ performance, and our performance, may be adversely affected by the financial performance of our portfolio companies and the industries in which our funds invest.
  • Third-party investors in certain of our funds with commitment-based structures may not satisfy their contractual obligation to fund capital calls when requested by us, which could adversely affect a fund’s operations and performance.
  • Our funds make investments in companies that are based outside of the United States, which may expose us to additional risks not typically associated with investing in companies that are based in the United States.
  • Many of our funds make investments in companies that we do not control.
  • Increased regulatory scrutiny and uncertainty with regard to expense allocation may increase risk of harm.
  • We derive a substantial portion of our revenues from funds managed pursuant to management agreements that may be terminated or fund partnership agreements that permit fund investors to request liquidation of investments in our funds on short notice.
  • Investors in certain of our funds, including our open-ended funds, may redeem their investments in these funds. Third-party investors in many of our funds have the right to remove the general partner of the fund and to terminate the investment period under certain circumstances. In addition, the investment management agreements related to our separately managed accounts may permit the investor to terminate our management of such accounts on short notice. These events would lead to a decrease in our revenues, which could be substantial.
  • A downturn in the global credit markets could adversely affect our CLO investments.
  • Our funds may face risks relating to undiversified investments.
  • Our funds may be forced to dispose of investments at a disadvantageous time. Furthermore, we may have to waive management fees for certain of our funds in certain circumstances.
  • Our real estate funds are subject to the risks inherent in the ownership and operation of real estate and the construction and development of real estate.
  • Certain of our funds invest in the power, infrastructure and energy sector which is subject to significant market volatility. As such, the performance of investments in the energy sector is subject to a high degree of business and market risk.
  • Investments in energy, manufacturing, infrastructure and certain other assets may expose us to increased environmental risks and liabilities that are inherent in the ownership of real assets.
  • Our investments in infrastructure assets may expose us to increased risks and liabilities.
  • Hedging strategies may adversely affect the returns on our funds’ investments.
  • If we were deemed to be an “investment company” under the Investment Company Act, applicable restrictions could make it impractical for us to continue our businesses as contemplated and could have a material adverse effect on our businesses.
  • Due to the disparity in voting power among the classes of our common stock, holders of our Class A common stock will generally have no influence over matters on which holders of our common stock vote and limited ability to influence decisions regarding our business.
  • The Holdco Members are able to significantly influence the outcome of any matter that may be submitted for a vote of holders of our common stock.
  • Potential conflicts of interest may arise among the Class B Stockholder and the Class C Stockholder, on the one hand, and the holders of our Class A common stock, on the other hand.
  • Certain actions by our board of directors require the approval of the Class B Stockholder, which is controlled by the Holdco Members.
  • As a “controlled company,” we qualify for some exemptions from the corporate governance and other requirements of the NYSE.
  • Our certificate of incorporation states that the Class B Stockholder is under no obligation to consider the separate interests of our other stockholders and contains provisions limiting the liability of the Class B Stockholder.
  • The Class B Stockholder will not be liable to us or holders of our Class A common stock for any acts or omissions unless there has been a final and non-appealable judgment determining that the Class B Stockholder acted in bad faith or with criminal intent, and we have also agreed to indemnify other designated persons to a similar extent.
  • The provision of our certificate of incorporation requiring exclusive venue in the Court of Chancery in the State of Delaware for certain types of lawsuits may have the effect of discouraging lawsuits against us and our directors, officers and stockholders.
  • Our ability to pay dividends to the holders of our Class A and non-voting common stock may be limited by our holding company structure, applicable provisions of Delaware law and contractual restrictions or obligations.
  • The Class B Stockholder or the Class C Stockholder may transfer their interests in the shares of our Class B common stock or the shares of our Class C common stock, respectively, which could materially alter our operations.
  • Our certificate of incorporation also provides us with a right to acquire shares of our Class A common stock under specified circumstances, which may adversely affect the price of shares of our Class A common stock.
  • Other anti-takeover provisions in our charter documents could delay or prevent a change in control.
  • We will be required to pay the TRA Recipients for most of the benefits relating to our use of attributes we receive from prior and future exchanges of Ares Operating Group Units and related transactions. In certain circumstances, payments to the TRA Recipients may be accelerated and/or could significantly exceed the actual tax benefits we realize.
  • Tax consequences to the direct and indirect holders of Ares Operating Group Units or to general partners in our funds may give rise to conflicts of interests.
  • The market price and trading volume of shares of our Class A common stock may be volatile, which could result in rapid and substantial losses for holders of our Class A common stock.
  • The market price of shares of our Class A common stock may decline due to the large number of shares of Class A common stock eligible for exchange and future sale.
  • We are a corporation, and applicable taxes will reduce the amount available for dividends to holders of our Class A and non-voting common stock in respect of such investments and could adversely affect the value of our Class A and non-voting common stockholders’ investment.
  • Applicable U.S. and foreign tax law, regulations, or treaties, and changes in such tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could adversely affect our effective tax rate, tax liability, financial condition and results, ability to raise funds from certain foreign investors, increase our compliance or withholding tax costs and conflict with our contractual obligations.
  • Certain stockholders that are individuals, estates, or trusts may be subject to additional tax on “modified adjusted gross income” in excess of a certain threshold pursuant to legislation recently proposed by the Presidential administration and the U.S. Congress.
  • Limitations on the amount of interest expense that we may deduct could materially increase our tax liability and negatively affect an investment in shares of our Class A common stock.

Content analysis

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